Peoples Gas wins second rate hike in less than two years

The $75 million delivery rate hike will boost Chicagoans' monthly gas bills by up to $2.75.

Chicagoans will be paying more to heat their homes beginning next month.

The Illinois Commerce Commission today approved a $75 million delivery rate hike for Peoples Gas, the second increase for Chicago's natural gas utility in less than two years.

The vote was 3-1, with Commissioner Miguel del Valle opposing. Newly appointed Chairman Brien Sheahan voted for the increase. John Colgan, whose term just expired, wasn't at the meeting, and new Gov. Bruce Rauner hasn't yet named his replacement.

The rate hike will boost Chicagoans' monthly gas bills by up to $2.75, according to the ICC. The amount the ICC approved was 75 percent of the $100 million Peoples ultimately asked for after trimming its initial $129 million request.

The ICC approved a $56 million rate increase for Peoples in June 2013.

The latest rate hike comes even as commissioners are being asked to approve the sale of Peoples' Chicago-based parent, Integrys Energy Group, to Milwaukee-based Wisconsin Energy. Wisconsin Energy has offered to freeze Peoples' delivery rates for two years after the acquisition closes. The Emanuel administration has argued in written testimony before the ICC that a rate freeze should last at least three years and as long as five years.

The frequent rate increases are tied in large part to Peoples' efforts to accelerate the pace of its multibillion-dollar project to replace aging gas mains under the city's streets.

In addition to the hike for Peoples, the commission approved a $3.7 million increase for sister utility North Shore Gas, which serves many of the northern suburbs. That was a little over half North Shore's original request of $7.1 million.

In a release, consumer advocate Citizens Utility Board said it planned to petition the commission to reconsider portions of the rate hike.

"In total, Peoples and North Shore Gas have received more than $250 million in rate hikes since 2008, and their parent company is expected to make more than $240 million in 2014 profits when those final numbers are announced," CUB said. "Chicago consumers deserve a break from their gas company."